We have all sorts of fears, rational and irrational, but have you ever worried that your older self may be wandering the streets alone and penniless, with all your worldly possessions stuffed inside a shopping cart? If you have – you are not alone.
Although enormous strides professionally and financially have been made by women in the last few decades, a survey conducted by Allianz Life Insurance Company sighted that nearly one-half of American women fear they will become a “bag lady”. So, why is it that many carry this as their deepest darkest fear? Most likely it’s due to the fact that women face a special set of circumstances when saving for retirement.
These “Special Circumstances”, make us painfully aware of our limitations, thus produce fear. No need to lose hope – fear is a colossal mechanism for change. So let’s examine the reasons behind our fears and make some changes.
Listed below are some financial obstacles women are facing today according to the U.S. Department of Labor’s, 2013 publication of “Women and Retirement Savings”.
- Working women are more likely than men to interrupt their careers to take care of family members. Some of the consequences include loss of income, health insurance, and retirement benefits; this in turn results in lower lifetime savings and benefits.
- Women are more likely to try and balance work and family by working part-time, which can result in less income and possibly limited career advancement.
- Of the 62 million US wages and salaried women (age 21 to 64) only 45% participate in a retirement program.
- On average, a female at age 65 can expect to live another 20 years, 2 years longer than a man the same age. This increases the need for additional funds in retirement.
- Women that do work full-time, year round, earn only 81% (on average) of what men earn. This gap can considerably reduce funds for retirement savings.¹
While these stats show women face strong headwinds financially, the stats on women’s future in the workforce are overwhelmingly positive. Women today are becoming a notable economic force. They are better educated and seek to successfully integrate their work and home lives to provide for themselves and their families. So stop worrying, instead choose to empower yourself with knowledge and solutions. Today women have a financial responsibility to learn how to save, invest and plan for the future. Seek guidance from a financial professional today and get started on the road to a solid financial future.
Answers from AZ
¹ U.S. Department of Labor, Equal Pay